The following cost formula for total purchasing cost in a factory was developed using monthly data. Purchasing
Question:
The following cost formula for total purchasing cost in a factory was developed using monthly data.
Purchasing cost =$123,800 + ($15 × Number of purchase orders)
Next month, 2,000 purchase orders are predicted. The total cost predicted for the purchasing department next month.
a. is $2,000.
b. is $153,800.
c. is $30,000.
d. is $123,800.
e. cannot be determined from the above formula.
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Related Book For
Cornerstones of Managerial Accounting
ISBN: 978-0324660135
3rd Edition
Authors: Mowen, Hansen, Heitger
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